January 31, 2011

• State Budget
• Work Comp Reform
• Unemployment Insurance Reform
• Immigration Reform
• Lieutenant Governor Visits Wichita Metro Chamber

Legislative budget committees, in both the House and Senate, fine-tuned bills dealing with cuts to the fiscal year 2011 budget  to be forwarded their respective chambers.  In Governor Brownback’s State of the State address, he outlined approximately $52M in cuts to the current year budget.  The Governor then requested that the legislature take immediate action and forward a bill to his desk by the end of January – a pretty aggressive target both in terms of dollars and timing. 

The House Appropriations Committee acted first and cut an additional $2 million.  The Senate followed and dramatically reduced the cuts made by the Governor.  Watch for both chambers to change the bills only slightly before sending them across the rotunda to each other.  With the House budget cutting more than the Governor and Senate budget cutting less, the likely outcome from a conference committee will be a compromise bill that probably looks an awful lot like what the Governor proposed in the first place.  The real question is whether  a much more conservative House will sign-off on that type of agreement.

Business, labor, and the plaintiff’s bar have come to an agreement – in principle – on work comp reform.  Representatives are now conferring with legislative leadership before drafting a final version of the legislation.  It is possible that hearings could be held on the bill by the middle of next week.  We will share the exact language of the bill when it’s released.

There was also plenty of talk this week about reforming unemployment.  Folks are correctly concerned about significant increases in 2012 if reforms are not put in place.  Remember, the fund is insolvent and payments to the unemployed are only taking place because we have borrowed from the federal government.  That money has to be paid back and those payments start next year.  That will be costly no matter what, but reforms could lessen the impact for business owners.  New Labor Secretary, Karen Brownlee, has compiled a set of proposals with the goal of both stabilizing the fund and paying back the federal government.  Key among the changes – adding up to six (6) new rate classes based on experience ratings; reinstating the “waiting week”; and eliminating eligibility for a spouse to receive UI benefits when relocating with their spouse.  Spouses of military members would still be eligible.

Although nothing has been produced yet, it now seems fairly certain that an Arizona-type immigration law will be introduced this session.  Most would agree that laws need to be enforced and that immigration is an area that needs to be addressed in some way. The main concern for business is any bill that would require business to perform for “free” the duties that the state or federal governments cannot or will not perform themselves. 

Finally, the Chamber was thrilled to have Lt. Governor Jeff Coyler drop by Thursday afternoon.  He emphasized the administration’s commitment to reducing business costs and said he and the Governor know that it is growth in the business sector, not government, that will lead to economic recovery.  He also said the Governor has a clear understanding of the value of and contributions to the state made by the metro Wichita business community.

Government Relations Staff

Barby Jobe, Vice President, Government Relations, bjobe@wichitachamber.org

Jason Watkins, Director, Government Relations, jwatkins@wichitachamber.org

Pat Gallagher, Manager, Government Relations, pgallagher@wichitachamber.org